Swedish ball-bearings manufacturer SKF announced Wednesday it will scale back production in the coming months, citing expected flat European demand in the fourth quarter.
"Looking forward we continue to operate in an uncertain business environment which may even have worsened slightly in Europe in the last months," SKF President and CEO Tom Johnstone said. "As such we expect demand for our products in the fourth quarter to be relatively unchanged both sequentially and year on year and will run manufacturing a little lower than sales to further reduce inventories."
SKF also reported its third quarter financial results, showing a 7.8 percent rise in operating profit to 2.07 billion Swedish Crowns ($284 million), coming up short of a forecasted 2.17 billion. Q3 profit last year was 1.92 billion. Sales for Q3 increased 13.9 percent year-over-year to SEK 17.8 billion ($2.5 billion), while year-to-date sales were up 18.2 percent to SEK 52.5 billion ($7.3 billion) and YTD profit grew 28 percent to SEK 6.2 billion ($863 million).
In local currencies, Q3 sales exluding structure were relatively unchanged in Europe and Latin America, while they were up 3 percent in North America, 7 percent in the Middle East and Africa, and up 8 percent in Asia. YTD, sales were up 3 percent in North America.